Technical & Fundamental Oil Reports Specialists

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Both are negative but it is advised to be flat

Published Wednesday, January 7th, 2015

It makes technical sense to be squared on both contract but for different reasons. The crucial support was closed below on ICE and this contract headed straight to the next one which is holding for the time being. On NYMEX the very long term support trend line was not closed below, this contract retraced higher but not high enough to sell short. In other words, patience is needed and selling short is recommended on closes below supports or rallies to resistances.

February ICE: In yesterday’s report we argued that the long-term monthly correction point at 47.17 was the level to watch and cover short positions when it is tested and sell short again if closed below. All of these took place so shorts banked some money over the course of the day and they had the opportunity to get back into the market at the close. Not only did they re-establish their positions but they likely went flat again this morning as the 47.55 support, the continuation high on June 16, 2014 has been tested and broken below. The contract is negative therefore an eventual rally to the 47.17 c/p resistance is a sell with a stop just above the 5-day M/A at around 47.37.

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Posted by Tamas Varga

Tamas Varga has been in the oil industry since 1992 and with PVM for 18 years. During his time in the industry he has gathered a range of experience in the oil markets. At PVM Tamas is in charge of data collection and analysis.